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Comment by djoldman | Hacker News Reader

It appears that the crux of the article is that a lot of price fixing is going on through the use of programs that suggest or encourage pricing among a few players, to the advantage of all the players and the disadvantage of the customer.

Crackdowns do take time in the US but there is hope. See e.g.:

https://www.justice.gov/opa/pr/justice-department-sues-realp...

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The current administration, however, plans to let M&A run wild. Oligopolies don’t need an app for uncoordinated price fixing. The fact that there’s a cartel that controls 97% of the frozen potato market is wild. This will only get worse without breakups.

> cartel that controls 97% of the frozen potato market

This is a weird and emotionally loaded statement. Properly stated, the top four frozen potato producers have 97% of the market share.

That doesn't sound odd? In a mature market with very little technology innovation (potatoes) and very little geographic specificity (frozen), how many companies would you expect? How many laundry detergent companies are there? How many cereal companies are there?

How was this different in the past, except going back to before the interstate highway system?

> This is a weird and emotionally loaded statement. Properly stated, the top four frozen potato producers have 97% of the market share.

Properly stated they colluded to fix prices. This is the definition of a cartel.

It’s different because they are using data at scale to collectively decide on pricing via Potatotrac, ya know, the title of the article…?

The issue of having four players is that it makes the coordination problem of colluding relatively easier, but they are price fixing via giant data warehouse which is algorithmically suggesting how to price.

It’s like Real Pages for potatoes, or at least this is what the article claims and what is interesting.

In an era where you can have a computer churn through a trillion datapoints to arrive at an optimal price, is it even possible to have competitive pricing as was once conceived of? The elements of uncertainty and risk have been so thoroughly eliminated that inflation seems almost unstoppable as you have such a strong signal for what the market will bear.

It’s an interesting question for the nature of free markets but few seem to have caught on to this dynamic…

Those statements are not equivalent. “Cartel” and “top four producers” mean very different things. I don’t know if there is in fact a cartel, but you’re missing the point.

TBH I would think that frozen potatoes might have more competitors. It sounds like the kind of market that could have lots of players assuming that all it really comes down to is a warehouse by train or dock: It doesn't seem obvious that a 10 acre warehouse of frozen potatoes would have an obviously drastic cost advantage over another company with an 8 acre or 12 acre one.

Yet they don’t so clearly its not so easy. Who do you sell your potatos to? Mcdonalds? They probably have a contract already. Where do you even get your inputs, some farm that happens to not have a potato buyer lined up already? Where do you get your machinery for the process, from the toolmaker owned by the competitor perhaps that won’t sell you the state of the art?

Business concepts are easy. Actually doing business is hard no matter what it is. Especially when for one reason or another, 97% of the market is controlled by the potato cartel. Chances are you will find a Great Filter somewhere that ensures this cartels market share is maintained.

> Actually doing business is hard no matter what it is. Especially when for one reason or another, 97% of the market is controlled by the potato cartel.

Yes, it’s hard because you’re trying to fight a cartel. And furthermore, the cartels distribute their products to other cartels - grocery stores that have consolidated over the years into Walmart, Kroger and Publix. And if you don’t like it, you have to change the laws which are controlled and dominated by the cartels and their donations. Thanks to citizens United. The US economy is far from capitalism.

It doesn't matter how the cartel came to be, if it's a cartel fixing prices, it's illegal. You are doing a lot of water carrying for criminals here, ever consider how that makes you look?

In a healthy economy I would expect the government to prevent that level of concentration and ensure that every potato producer and every potato buyer had multiple local options for processing and distribution. Like you said, mature technology, very little innovation or geographic specificity - anyone with startup capital should be able to get in the business. Instead we let a handful of corporations define and regulate the market for their own benefit. How does that make any sense?

if top 4 independently controlled 97%, that wouldnt be bad. But rather, if they are colluding via an app, it is a caretl. pure and simple.

Seems odd to me for a country with 300+ million people in it.

when I hear a “farmer” complaining on the news about losing illegal immigrants and how they can’t afford to pay living wages to people working on their farms. News organizations make it sound like these farmers are individual small businesses when they are actually huge corporation themselves taking advantage of workers.

Lawsuits are filed in this case as well:

https://www.washingtonpost.com/business/2024/11/20/potato-ca...

There is zero chance that this kind of Justice department actions will be continued in the current administration

The previous administration didn’t do anything either. They, oh oops, studied for 3.5 years, and launched processes in the last 4 months of the 4 years. Oh my, I need to reelect them to see it happen!

Actually, there’s still a chance the current administration can do something about it. But there’s a zero chance the previous administration did anything about it.

Lina Khan did a ton of anti-trust but corporations seem to have realized Trump is transactional/pay to play. One can hope the strong antitrust continues but there’s little reason for optimism.

Unfortunately, pay to play is better than no pay to play. Recently, Trump had the audacity to ask for half of TikTok for the government to approve the deal. That sounds like a lot more than Lina Khan or Biden would’ve demanded.

By the way, I’m not condoning government ownership of corporations as the ideal solution, but I absolutely do not approve of huge corporate subsidies with no value in return for tax payers and handwaving small fine penalties for obvious monopoly behavior.

The New Deal, which Bernie was resurrecting, was meant to break monopolies up, to promote completion and make price fixing impossible. the democrats voted against that as they are controlled by the big companies too. this is easy MAGA exists, and won.

Lina Khan led the most antitrust-focused DoJ in a century, which went after Apple, Google, Nvidia, Realpage, airlines, and dozens of other companies.

MAGA give zero fucks about antitrust, and antitrust or lack thereof has nothing to do with the creation of MAGA. That's such an absurd argument I have no idea how to even respond to it. The cornerstone of MAGA has always been nativism & reactionary politics.

I'm very, very tired of leftists shamelessly lying about anything and everything they can just to smear the Democrats.

What did Lena Kahn actually accomplish though? Maybe they had to pay some fines some traffic tickets essentially.

Many mergers were squashed. The M&A market shrank considerably. There’s only so much they can do as far as bringing and prosecuting cases in four years.

M&A market shrink because interest rates went up drastically while expectations of companies remained in the stratosphere in my opinion.

Lina Khan had little to do with it. What significant mergers were squashed that made a difference? What significant monopolies were busted?

Doubtful. Most deals aren’t financed with debt.

There are many but off the top of my head Kroger buying Safeway. Visa buying Plaid. Nvidia buying Arm. Didn't they block a cell phone merger? A mattress merger?

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